Puget Sound receives consents for 6.274% notes, extends deadlines

New York, May 24 – Puget Sound Energy, Inc. said that it is extending the deadlines in its consent solicitation for its 6.274% senior notes due March 15, 2037 and its tender offer and consent solicitation for its $250 million of 6.974% series A enhanced junior subordinated notes due June 1, 2067.

The company has received the requested consents to amend its 6.274% notes but has not reached the threshold to approve changes to its 6.974% notes due June 1, 2067, according to a news release.

Receipt of sufficient consents to amend the 6.974% notes is a condition to making the changes to the 6.274% notes.

The consent solicitation for the 6.274% notes will now end at 5 p.m. ET on June 7, delayed from 5 p.m. ET on May 23.

Puget Sound also extended the consent deadline for the 6.974% notes to midnight ET on June 7 from 5 p.m. ET on May 23. The new consent deadline coincides with the expiration of the cash tender offer for the notes.

On May 10 Puget Sound announced a cash tender offer and consent solicitation for its 6.974% notes and a consent solicitation for its 6.274% notes.

In the tender offer for the 6.974% notes, the company is offering to pay $850 per $1,000 principal amount, a total that includes a consent payment of $30 per $1,000 principal amount.

The consent payment was originally to be paid only to holders who tendered by the consent deadline of 5 p.m. ET on May 23, but the limit has now been extended.

Puget Sound will also pay accrued interest up to but excluding the settlement date, expected to be May 24 for early tenders and June 8 for final tenders. The tender will end at 12 a.m. ET on June 7.

The consent solicitation is seeking to eliminate the restrictions which prevent the company from repurchasing, redeeming or repaying the 6.974% notes on or before June 1, 2047 unless a specified portion of the funding is obtained from the sale of common stock or other equity or equity-like securities.

Approval of holders of a majority of the notes is needed to make the change.

Puget Sound said that the current 6.974% fixed rate of interest on the notes will convert to a floating rate of Libor plus 253 basis points beginning on Dec. 1, 2017.

The notes are also callable starting June 1, 2017 at par although Puget Sound said it currently anticipates that it will not exercise its right to redeem the notes on the initial par call date.

The tender offer is subject to conditions, including the receipt of sufficient consents to amend the note indenture, the receipt of sufficient consents to amend its 6.274% notes and a financing condition.

In the solicitation for the 6.274% notes, Puget Sound is seeking to terminate the replacement capital covenant.

The covenant was granted in connection with the issuance of the 6.974% junior notes.

Puget Sound explained that it was seeking to terminate the covenant because it includes restrictions on its ability to repurchase, redeem or repay the junior notes.

To make the change, the company needs consents from holders of a majority of the notes.

The consent solicitation was scheduled to end at 5 p.m. ET on May 23 but the deadline has now been extended.

If it is successful and the conditions are met, the company will pay a consent fee of $10.00 per $1,000 principal amount to holders who deliver consents.

Barclays (800 438-3242 or 212 528-7581) is dealer manager for the tender offer and solicitation agent for the consent solicitation. D.F. King & Co., Inc. (877 732-3614) is information agent and tabulation agent.

Puget Sound Energy is a Bellevue, Wash.-based electric utility company.

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